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2023 (1) TMI 301 - AT - Insolvency and BankruptcySeeking direction to the Appellant to vacate the premises belonging to the Corporate Debtor in his possession - remedy of Resolution Professional for taking possession from the Appellant whose lease had come to an end on 31st December 2021 was only taking proceeding for eviction under MP Accommodation Control Act 1961 - Whether the Committee of Creditors who have decided to renew the lease in favour of the Appellant till 31st December 2021 had jurisdiction to issue legal notice for eviction of the Appellant from the premises in question? HELD THAT - The provisions of Section 18 of IBC empowers the IRP to take control and custody of any asset over which the corporate debtor has ownership rights. When we look into the Section 18(1)(f)(ii) the duty is also to take control and custody of assets that may or may not be in possession of the corporate debtor. For carrying out the duties entrusted to the IRP under Section 18 of the Code and those entrusted on RP under Section 25 the IRP/RP can very well take recourse to Section 60. For effectuating the duties entrusted on the IRP under Section 18 recourse to adjudicating Authority by filing an Application under Section 60(5) is fully permissible. In the present case we are considering the case where there is no dispute that assets in question is owned by the Corporate Debtor hence by virtue of Section 18(1)(f) Resolution Professional can take steps for taking possession of the assets. To resist the case taken by the RP Appellant contends that under Section 60(5) no Application can be entertained for eviction of the Appellant and the only remedy available to the RP is to take proceedings under MP Accommodation Control Act 1961. It is further relevant to notice that present is a case where renewal lease dated 17.09.2021 was executed by the RP himself for a period of 5 months till 31st December 2021. The present is not a case where lease in favour of the Appellant is subsisting. The lease has come to an end on 31st December 2021. Further the lease renewal in favour of the Appellant was by RP himself on 17.09.2021 (Fresh Lease) which lease contained specific clause for eviction by 15 days notice - When the Corporate Debtor has the ownership rights over the premises which premises can be taken in control by IRP/RP we are of the view that for eviction of the Appellant especially in event when lease in favour of the Appellant has come to an end filing a suit is not contemplated in the statutory scheme contained in IBC. The contention of the Appellant that RP has to file a suit for eviction of the Appellant under the MP Accommodation Control Act 1961 can not be accepted - the Adjudicating Authority has rightly allowed the Application filed by the RP directing the Appellant to vacate from the premises so that Resolution Plan which has been approved can be implemented. The Appeal is dismissed.
Issues Involved:
1. Jurisdiction of the Adjudicating Authority to entertain the application filed by the Resolution Professional (RP) for possession of the premises. 2. Remedy for the RP to take possession from the Appellant under MP Accommodation Control Act, 1961. 3. Authority of the Committee of Creditors (CoC) to issue a legal notice for eviction. Issue-wise Detailed Analysis: 1. Jurisdiction of the Adjudicating Authority: The primary issue was whether the Adjudicating Authority had the jurisdiction to entertain I.A. No. 200 of 2022 filed by the RP seeking direction to the Appellant to hand over the possession of the premises owned by the Corporate Debtor. The tribunal noted that Section 18(1)(f) of the Insolvency and Bankruptcy Code (IBC) empowers the Interim Resolution Professional (IRP) to take control and custody of any asset over which the corporate debtor has ownership rights. Section 60(5) of the IBC further provides the National Company Law Tribunal (NCLT) with jurisdiction to entertain or dispose of any application or proceeding by or against the corporate debtor. The tribunal concluded that the Adjudicating Authority had jurisdiction to entertain the application filed by the RP for possession of the premises. 2. Remedy for the RP under MP Accommodation Control Act, 1961: The Appellant argued that the RP should have initiated eviction proceedings under the MP Accommodation Control Act, 1961, as the Adjudicating Authority lacked jurisdiction to direct eviction. The tribunal emphasized that the IBC is a time-bound process and that requiring the RP to file a suit under the MP Accommodation Control Act would unduly prolong the insolvency process. The tribunal held that the statutory scheme under the IBC did not contemplate the necessity of filing a suit for eviction when the lease had expired, and the RP had the authority to take control of the premises. 3. Authority of the CoC to Issue Legal Notice for Eviction: The tribunal considered whether the CoC had the authority to issue a legal notice for the eviction of the Appellant. It was noted that the CoC, in its 10th meeting, had approved the renewal of the lease till December 2021, and a fresh lease deed was executed by the RP. However, the CoC, in its 16th meeting, resolved to issue a legal notice for eviction, which was subsequently sent to the Appellant. The tribunal concluded that the CoC had the authority to issue the legal notice, and the Appellant was obligated to vacate the premises as per the terms of the lease agreement. Conclusion: The tribunal dismissed the appeal, affirming that the Adjudicating Authority had the jurisdiction to entertain the application filed by the RP, that the RP was not required to file a suit under the MP Accommodation Control Act for eviction, and that the CoC had the authority to issue the legal notice for eviction. The tribunal directed the Appellant to vacate the premises within 15 days to allow the implementation of the approved Resolution Plan.
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